MS sizes up UK tax system

Analysts question government willingness to rely on beta technology to support new tax credit legislation

Analysts question government willingness to rely on beta technology to support new tax credit legislation

The UK Government is on the verge of becoming one of the first reference sites in the world for .net, a new generation of Microsoft products described by analysts as exciting - but unproven.

An announcement of the Government's commitment to the technology, which is still in the beta test stage, was expected to be made during a visit to London today (Thursday) of the supplier's founder Bill Gates.

Microsoft had also planned to make the announcement in conjunction with statements from the Inland Revenue and its strategic IT partner EDS. Both are keen to include .net products in a new tax credits system due to be introduced in 2003.

But on Tuesday the Government refused permission for the announcement. Computer Weekly understands that the Treasury considers it too early to make an announcement on the technology as a public consultation exercise over the introduction of new tax credits legislation finished less than two months ago.

The new tax credits Bill will not be debated in parliament until June next year. It is part of the Government's reform of the tax and benefits system.

Analysts say .net - a suite of products for developing software - could help to bring about the prime minister's vision of government that is accessible online to citizens, particularly as Microsoft staff believe that tests have established that the technologies are robust and adaptable.

Neil Ward-Dutton, research director at market analyst Ovum, said .net offered many potential benefits. But he added that there are doubts about security, speed and reliability.

"The adoption of .net at this early stage increases the risk of the system not working satisfactorily," he said.

The new technologies to be used by Inland Revenue and EDS include Visual Studio.net - successor to Visual Basic - and a new Microsoft language C#.

They will form key components in systems for delivering new tax credits.

One aim of the system is to replace income support benefit payments to some low-paid workers with a much simpler adjustment to the individual's tax code.

The .net products will be used to provide an interactive electronic form allow ing taxpayers to enter personal details and receive back details of their entitlement, if any, to tax credits.

They will also be used within the body of the application to provide a rules-based "engine" which will capture and validate data, complete tax-related calculations and, if necessary, seek further information.

The .net suite of products will exploit the XML Web-based interface, the C# language - a rival to Java - and the simple object access protocol (Soap) open standard to improve the interoperability of systems.

Inland Revenue and EDS have yet to sign an agreement on the use of .net, but a deal is said to be imminent.

Although the Government and Microsoft already have close ties - particularly over operating system licensing agreements where deals have recently been made to supply both the NHS and the Ministry of Defence, the new commitment will go further.

It will enmesh Microsoft's .net suite of development products in systems that help to deliver government policy. This could make Microsoft an indispensable supplier to the Government.

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